MONMOUTH -- Western Oregon University may lose approximately $520,000 in state funding because of the projected $142 million shortfall in Oregon's general fund at the end of the current biennium.

MONMOUTH -- Western Oregon University may lose approximately $520,000 in state funding because of the projected $142 million shortfall in Oregon's general fund at the end of the current biennium.

But the decrease won't impact faculty staffing levels or decrease current academic offerings, said Mark Weiss, vice president of finance and administration.

"Our fiscal health is currently strong," Weiss said. "We'll be able to weather this reduction fairly well."

Gov. Ted Kulongoski ordered state agencies late last month to cut as much as 1.2 percent from their budgets in response to a dismal forecast for July by Oregon economists.

"This recession demands tough decisions and requires shared sacrifice," Kulongoski said in a Nov. 19 statement. "And today's action is the first of many difficult decisions that lie ahead."

The Oregon University System (OUS), which oversees and distributes funds to seven public universities and a satellite campus, is expected to lose $10.1 million.

Schools and government departments are expected to institute cost-saving measures during the last six months of this budget cycle to balance Oregon's general fund in time for the 2009-11 fiscal year.

"Happening in the last quarter of the biennium, this has the effect of a 5-percent reduction," said Jay Kenton, OUS vice chancellor of finance and administration.

The cuts will affect Western in three ways. First, Western's projected fund balance of 15 percent -- $6.8 million -- of the year's operating revenue will fall below that mark, Weiss said.

The state recommends a 5- to 15-percent fund balance as insurance against unforeseen financial problems and to deter excessive surplus.

The university will also selectively not fill certain staff vacancies -- administrative assistants, for example -- and will be more stringent with travel, supplies and service spending, Weiss said.

Western is in a fortuitous position because of tuition revenue based on a record enrollment this year and higher retention, Weiss said.

"In addition, we took some difficult actions about three years ago in restructuring the way we did business," Weiss said. "At that time, we eliminated about 30 positions and over time we've been able to reallocate those resources in different ways."

Western will escape relatively unscathed in this round of reductions compared to some of its higher education peers.

Kenton said Oregon State University will be hardest hit and could lose as much as $4.2 million from its main campus, Extension Service and Cascade Campus in Bend. Eastern Oregon University will have to cut $400,000, compounding problems with an already low reserve total.

Still, there is good news for Oregon universities and colleges in Kulongoski's general fund proposal for 2009-11, released Monday.

The governor has requested appropriations totaling $917 million for the next biennium, a 5-percent increase from what lawmakers adopted in 2007 for the current fiscal cycle.

"Given the current state of Oregon's and the national economy, it was not expected that the OUS would receive a budget the size and scope of that received for 2007-2009," said George Pernsteiner, OUS chancellor, in a release. "But the more modest increase in the general fund budget will enable the system to hold steady and, in some cases, gain ground."